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When the NDP government took on international drug companies in the 1990s with its reference-based pricing plan, the opposition Liberals lined up, sort of, on the other side.

I say sort of, because reference-based pricing was hard to argue against, since by pegging the price paid by the provincial drug plan for a type of treatment to the lowest effective alternative, it was saving the province millions without any significant harm to patients.

Mike de Jong, now health minister but an opposition MLA in 1995, wouldn’t say then whether a Liberal government would scrap reference-based pricing but nonetheless attacked NDP management of Pharmacare.

“This system isn’t working and will have to be rethought rather dramatically,’’ he said at the time.

The drug companies fought the plan politically with ads warming British Columbians that their health was at risk and with subtle threats to pull funding for research from B.C. and legally with a failed challenge that went all the way to the Supreme Court of Canada.

When the Liberals swept aside the NDP in 2001, one of the items on their to-do list was to “work with doctors, pharmacists and others to find a cost-effective alternative to reference-based pricing.” They wanted to stop the feuding with pharmaceutical companies to encourage more investment here.

Once in office, they very quickly discovered the driving force behind the NDP’s struggles to curb drug costs. In a health care system that was pushing the boundaries of resources every year, drug costs were in a class of their own, growing much faster than other costs in the system.

So while they launched a committee to look for a way to ditch reference-based pricing, they also quickly pronounced the provincial drug plan, Pharmacare, as unsustainable, the benefits too expensive, the fees too low.

The panel headed by former B.C. auditor-general George Morfitt reported back that there was no substitute for reference-based pricing that could save the government so much money, $12 million in that year alone. So the plan stayed, while the government moved to limit benefits for people who could afford their own drugs, including seniors for the first time.

Meanwhile, other jurisdictions caught in the same struggle with soaring drug prices came up with other solutions that curbed costs even more. New Zealand, for example, went to a sole-source tendering system that has encouraged manufacturers to supply generic drugs at much lower costs than we were paying here.

Ontario came up with a system that arbitrarily limited what it would pay for generic drugs to a set percentage of the non-generic alternative. It unilaterally lowered that price to 25 per cent of the brand-name reference price and a report in 2010 found that if B.C. were to move to the Ontario system, we could save $157 million a year.

But B.C. still wanted to play nice with the drug companies, so it signed an agreement with suppliers and drugstores that set a price of 40 per cent of the brand-name equivalent, down from an average of about 65 per cent. The government said the deal would create $170 million in savings for Pharmacare and more for private drug plans.

The price was also to drop to 35 per cent at the beginning of April this year. But last month, de Jong announced the deal had been a bust for taxpayers, providing only a fraction of the promised savings because of the number of exceptions that were being claimed that drove up the base price.

This week, de Jong introduced legislation that will allow B.C. to unilaterally set the price it is willing to pay for generic drugs. Earlier, de Jong said the intent was to drive down the price paid to 25 per cent of the brand-name reference.

But coincidentally, Ontario announced this week that it is again lowering the price it will pay for generics to 20 per cent of the reference price. While pharmacies have been wincing, there doesn’t seem to be any indication in that province that they won’t be able to supply the drugs and still make a profit at the new price.

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